Time for Sun(tv)set???

SUN TV Network’s market capitalisation dropped by Rs 936.54 crore in the last five trading sessions on the BSE, reflecting investors’ concerns about the impact of recent political developments on the leading entertainment company. Sun TV’s market cap was above Rs 11,124.57 crore last Wednesday, and dropped to about Rs 10,188.02 crore on Tuesday. Sun TV’s Rs 10 paid-up share price on the BSE dropped 3.62% on Tuesday to Rs 1478.90 on top of a 4.31% drop on Monday, even while BSE sensex dropped 0.26% on Tuesday against a gain of 1.18% on Monday.

On Sunday, Dayanidhi Maran, brother of Sun TV’s chairman and CEO Kalanidhi Maran, offered to step down from the Union Cabinet where he was a minister of IT and communication, after DMK’s administrative committee sought his exit. A day later, prime minister Manmohan Singh accepted his resignation. Kalanidhi Maran, who, as the biggest shareholder of Sun TV (he holds about 90% stake), saw his own wealth coming down by over Rs 84 crore during this period, has always maintained that Sun TV had nothing to do with DMK. Similarly, Dayanidhi Maran, speaking to reporters in Chennai on Monday, said he had nothing to do with either Sun TV or Dinakaran. Yet, the drop in share prices comes amid widening rift between DMK leaders and Dayanidhi Maran. On Monday, Mr Maran made an attempt to reach out to the party and its leader M Karunanidhi asserting his loyalty. But the response from DMK leaders suggest that a compromise doesn’t appear to be in sight at present.